Mortgage Calculator Australia

How this mortgage calculator works

Enter the property price, your deposit, the interest rate and how long you want the loan to run. The calculator then shows the repayment on a standard principal and interest home loan, and you can flip between monthly, fortnightly and weekly repayments to see how the number changes.

The big figure is what you'd pay your lender, nothing more. In Australia, council rates, water, building insurance and strata levies are billed separately, so we show them on their own line under the results instead of blending them into the repayment. That way the repayment matches what your lender would quote, and you can still see what the property costs you each month to hold.

Deposit, LVR and lenders mortgage insurance

Lenders describe your deposit through the loan-to-value ratio, or LVR. It's simply the loan divided by the property's value. Borrow $600,000 against a $750,000 property and your LVR is 80%, which is the same as having a 20% deposit.

Once your LVR goes above 80%, most lenders will ask you to pay lenders mortgage insurance (LMI). It's a one-off premium that protects the lender, not you, if the loan goes bad. The cost depends on the lender, the size of the loan and how small your deposit is, and on bigger loans it can run to five figures. Plenty of buyers add it to the loan rather than paying cash, which is why the calculator has an "add LMI to the loan" option. Just remember you then pay interest on it for as long as the loan lasts.

The LMI percentage in the costs box is a rough placeholder. Ask a broker or lender for a real quote before you rely on it. It's also worth checking whether you qualify for a government home guarantee scheme, which can let eligible buyers get in with a smaller deposit and no LMI. The eligibility rules and caps change, so read them on the Housing Australia website rather than trusting an old article.

Offset account or extra repayments: which saves more?

Both reduce the interest you pay, but they work differently. An offset account is a transaction account linked to your loan. Interest is worked out on the loan balance minus whatever sits in the offset, so the money still belongs to you and you can still spend it. With $50,000 in offset and a 6.2% rate, you'd avoid roughly $3,100 a year in interest at the start, without handing that cash over for good.

Extra repayments go straight against the principal, so the balance falls faster and every later interest charge is smaller. On the earlier example, adding $300 a month would clear the loan about five and a half years sooner and save somewhere around $155,000 in interest. On most variable loans you can get the extra money back through redraw, but that depends on your lender's rules, so confirm before counting on it.

Open the "Offset account & extra repayments" box in the calculator and try a few combinations. The offset balance is treated as constant, so if yours moves around a lot, use a typical average.

Fortnightly or monthly repayments?

There are 26 fortnights in a year but only 12 months. Some lenders set the fortnightly repayment at half the monthly amount, which means you quietly make the equivalent of 13 monthly repayments each year. That extra one is what shortens the loan. Other lenders calculate a true fortnightly repayment, which comes out a little lower and doesn't cut the term in the same way.

This calculator uses the true fortnightly method. If you want to model the "half the monthly amount" version, note your monthly repayment, switch to fortnightly, and add the difference as an extra repayment. Whichever way your lender does it, paying more often can help if it lines up with your pay cycle and keeps you from spending the money elsewhere.

Costs that sit outside your repayment

Your repayment isn't the whole bill. Before settlement you'll usually face stamp duty, which each state and territory sets differently and which can depend on the price, whether you're an owner-occupier and any first home buyer concessions. Use your state or territory revenue office's own calculator and type the result into the stamp duty box here. You'll also need to budget for conveyancing, building and pest inspections, and lender or registration fees, which the "Legals & other" box covers.

After you move in, the ongoing costs are council rates, water, building insurance and, for units and townhouses, strata levies. Then there's maintenance, which is easy to forget and rarely small. Filling in these numbers gives you a more honest picture of whether a property fits your budget, not just whether the repayment does.

Fixed, variable or a bit of both

A variable rate moves with your lender's decisions. In return, variable loans usually let you make extra repayments freely and attach an offset account. A fixed rate locks your repayment for a set period, often one to five years, which is handy if you want certainty. The trade-off is that fixed loans often cap extra repayments, may not offer a full offset, and can carry break costs if you leave early. When the fixed term ends, the loan normally reverts to a variable rate unless you refinance or fix again.

Some borrowers split the loan, fixing part and leaving part variable. This calculator assumes one rate for the whole term, so treat the result as a guide. A useful habit is to run the numbers at your rate and again at a rate one or two percentage points higher, so you can see how much room you'd have if rates rise.

Frequently asked questions

How much deposit do I need to buy a home in Australia?

Many lenders want at least 5% to 10% of the price, plus money for stamp duty and other costs. A deposit of 20% avoids LMI and usually gets you better rate options, but it isn't compulsory.

Does the repayment include rates and insurance?

No. The repayment covers principal and interest only. Council rates, water, insurance and strata levies are shown separately as monthly ownership costs.

Does this calculator work out stamp duty?

No, because stamp duty differs between states and territories and depends on your situation. Check your state or territory revenue office, then enter the amount in the stamp duty box to see the total cash you'd need upfront.

What interest rate should I enter?

Use the rate your lender or broker has quoted. If you're only exploring, try a few rates around the current market. Banks also test whether you could cope with a higher rate, so it's wise to check your budget at a rate a few percentage points above the actual one.

What is an offset account?

It's a transaction account linked to your home loan. The balance is subtracted from the loan when interest is calculated, so you pay interest only on the difference while keeping access to your money.

Can I use it for an investment property?

Yes, for principal and interest loans. Interest-only periods aren't modelled, so the results won't match an interest-only investor loan.

How accurate are the results?

They're estimates based on the figures you enter and a constant interest rate. Lenders work out repayments in slightly different ways, and fees or rate changes will move the real numbers, so confirm the details with your lender.

This calculator provides general information only and isn't financial, credit or tax advice. It doesn't consider your personal circumstances. Speak with a licensed mortgage broker or financial adviser before making a decision, and compare lenders using the comparison rate as well as the headline rate.

Looking at other kinds of borrowing? Try our loan calculator or personal loan calculator.